South Port NZ, whose biggest shareholder is Southland Regional Council, says it will fight Invercargill City Council's bid to take back land transferred to the port when it was established nearly 30 years ago.
The city council is seeking legal title to three parcels of land at Bluff it says were transferred to South Port in error in 1988 when the port was set up under the Port Companies Act, according to a statement from the port company.
The proceedings also seek unspecified damages together with costs and interest, it said.
The port has received advice from its lawyers and based on that advice the proceedings will be defended, chief executive Nigel Gear says.
South Port said it had obtained a valuation for the current market value of the land at $1.28 million while the current rental, at less than $10,000 a year, was not considered material.
The port of Bluff has operated since 1877. South Port was created in 1988, having taken over the assets and liabilities of the former Southland Harbour Board.
South Port shares last traded at $5.92 and have gained 3.2 per cent in the past 12 months, lagging behind a 19 per cent gain for the S&P/NZX 50 Index.